Chipotle has nearly 23 million rewards members, making it one of the most active loyalty programs in the industry. And the company is now going even bigger, relaunching the program in April and showcasing its new features out of the gate with the return of the Summer of Extras promotion, including giveaways and frequency rankings.
Last year’s Summer of Extras debut generated 6.5 million new loyalty members. This year’s promotion includes even more streaks and challenges to further increase engagement.
In a recent interview, Curt Garner, president, chief strategy and technology officer, said the iteration is necessary because loyalty has become a bit of an “arms race.” Indeed, several brands have recently launched or updated their own programs as consumers clamor for not only more value but also a personalized experience, and as operators strive to generate more frequency amid a flat-traffic environment.
Garner added that the increasingly crowded market has pushed the industry into a new loyalty era all together. Loyalty started with paper cards, then moved into digital in the mid-2010s. Chipotle’s digital platform was first developed in 2016.
Many programs have been updated since 2020 as consumers seek more personalization and customization opportunities, having been trained for as much by Amazon and various social media algorithms.
Now, the industry is moving into a loyalty 4.0 phase.
“The nirvana of what is happening now is this idea of being able to unlock conversations,” he said. “Most commerce and digital commerce and rewards programs are fairly one direction, with email or (texts) that go to guests. Now, it’s allowing that messaging to be more unique and catered, and the end spot is that the guest has the ability to talk back. I’m excited to see where that goes.”
Agentic AI — which is capable of autonomous decision-making — is particularly intriguing to him, and, in addition to Chipotle, we’re starting to see some other brands, including Starbucks and Little Caesars, dip their toes into this opportunity.
“People are going to an agent and having conversations with the brand around nutrition, macro content, ingredients — that becomes a part of the transaction naturally,” Garner said. “If someone is concerned about having proteins free of hormones, they put that into an agent, and the brand has the ability to respond back about its clean ingredients.”
Gen AI, he added, is a bigger priority for Chipotle as more people become familiar with its applicability. The chain has ramped up its marketing budget to show up in Gen AI searches, which helped drive record Cinco de Mayo sales.
“Historically, and still to this day, marketing is geared toward the top of the funnel,” Garner said. “Now, we can take some of that money and put it toward personalized, relevant messaging and digital is the place to do that. We can learn more and respond proactively and reactively and with much more personalization.”
If there is a challenge here, it’s that the digital marketing world moves much faster and Chipotle, and other brands, need to keep pace. Garner said the rewards program gives the brand a “huge testing ground to try new things and fail fast.”
“Sometimes we need to fail. I don’t want weeks and weeks of opining whether something will work but rather have the velocity of experiences to test and some things work and some don’t,” he said. “That is the beauty of personalization. Some things resonate and some things don’t.”
That said, even the things that resonate need to be iterated, and quickly. So, even though Chipotle just enhanced its loyalty program, we’ll continue to see new features beyond Summer of Extras.
“When we first developed our digital platform, I told the team we’re going to rearchitect every year, whether we need to or not,” Garner said. “That seemed to be controversial at the time, but I never wanted to be outdated or need to catch up. Loyalty was and remains the Golden Gate Bridge analogy — once you’re done painting it, it’s time to paint it again.
“With the iterative way we look at this, we have no idea what we’re going to be talking about next year until we go through the process and see what works and what doesn’t. What I can promise is we’re not going to stand still.”
Contact Alicia Kelso at alicia.kelso@informa.com
Follow her on TikTok: @aliciakelso
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